Ulta Beauty (ULTA, $237.73) disappoints on earnings; lowers full-year guidance
Ulta Beauty shares plummeted close to -30% Friday, after the company lowered its fiscal- full-year outlook and also missed earnings expectations.
The chain of stores selling cosmetics and hair & skincare products reported net income of $2.76 per share which, although higher than the year-ago quarter’s $2.46, fell short of the Street estimate of $2.80.
Revenue for the quarter increased +12% year-over-year to $1.7 billion, which was in line with expectations.
Comparable sales (which in this case includes stores open at least 14 months and e-commerce sales) increased +6.2%. Last year same quarter, the growth was +6.5%.
But for the full-year, the company reduced its guidance citing headwinds in the U.S. cosmetics market. Ulta now expects EPS to range between $11.86 and $12.06 for the year, down from its prior projection of $12.83 to $13.03 range. The company indicated that the revision includes the effect of around $700 million in share buybacks and also the assumption of a 23% effective tax rate (versus 24% previously).
Ulta has predicted comparable sales growth of approximately +4% to +6%, down from previous estimates of +6% to +7%. The forecast includes e-commerce growth of +20% to +30%.
The company hopes to increase total sales by +9% to +12%, as compared to previous forecasts of low double-digit growth.
The company expressed plans to open around 80 new stores, remodel or relocate 20 others and do some touch-ups of about 270 stores.
Contributor
Sergey Savastiouk, Ph.D. has a degree in Applied Mathematics from Moscow University and has extensive experience as an entrepreneur, investor, manager, and mathematician. His professional expertise is in applied mathematics, mathematical modeling, system and pattern analysis, and software and hardware system integration. He has served as the CEO of several hi-tech start-up companies and nonprofit organizations, which has given him proven capabilities in business strategy for high-tech start-up companies, market assessment, company formation, team building, product development, marketing, and sales. He has published numerous articles in journals and magazines on related fields. As a retail investor, he spent 15 years developing his proprietary trading and quantitative algorithms (now Tickeron’s A.I.), which brought him significant returns in trading the stock market. His current work and goal in founding Tickeron is to bring professional, sophisticated stock market analysis capabilities to retail investors via an easy-to-use interface.
Aroon Indicator for ULTA shows an upward move is likely
ULTA's Aroon Indicator triggered a bullish signal on September 15, 2026. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 279 similar instances where the Aroon Indicator showed a similar pattern. In 212 of the 279 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at 76%.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Oscillator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 40 of 53 cases where ULTA's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 75%.
Following a +2.43% 3-day Advance, the price is estimated to grow further. Considering data from situations where ULTA advanced for three days, in 220 of 319 cases, the price rose further within the following month. The odds of a continued upward trend are 69%.
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on October 05, 2026. You may want to consider selling the stock, shorting the stock, or exploring put options on ULTA as a result. In 52 of 81 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 64%.
The Moving Average Convergence Divergence Histogram (MACD) for ULTA turned negative on September 10, 2026. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 43 similar instances when the indicator turned negative. In 27 of the 43 cases the stock turned lower in the days that followed. This puts the odds of success at 63%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where ULTA declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 62%.
Fundamental Analysis (Ratings)
The Tickeron SMR rating for this company is 23 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is 45 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is 47 (best 1 - 100 worst), indicating steady price growth. ULTA’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron Seasonality Score of 50 (best 1 - 100 worst) indicates that the company is fair valued in the industry. The Tickeron Seasonality score describes the variance of predictable price changes around the same period every calendar year. These changes can be tied to a specific month, quarter, holiday or vacation period, as well as a meteorological or growing season.
The Tickeron Profit vs. Risk Rating rating for this company is 60 (best 1 - 100 worst), indicating well-balanced risk and returns. The average Profit vs. Risk Rating rating for the industry is 90, placing this stock slightly better than average.
The Tickeron Valuation Rating of 93 (best 1 - 100 worst) indicates that the company is significantly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (8.881) is normal, around the industry mean (2.222). P/E Ratio (19.997) is within average values for comparable stocks, (243.370). Projected Growth (PEG Ratio) (1.978) is also within normal values, averaging (1.159). Dividend Yield (0.000) settles around the average of (0.018) among similar stocks. P/S Ratio (1.806) is also within normal values, averaging (1.057).
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General Information
a company that retails cosmetics and other personal care products
Industry SpecialtyStores
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